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BELLRINGER  Define “land of opportunity”  Provide examples of family or community members who started up small businesses.

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A TRADITION OF FREE ENTERPRISE  Why has America been such an economic success?  Open land  Natural resources  Uninterrupted flow of immigrants AND?

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FREE ENTERPRISE The social and political commitment to giving people the freedom and flexibility to try out their business ideas and compete in the marketplace

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CONSTITUTIONAL PROTECTION Property RightsTaxation  Can’t be taken from an individual except when there is a public reason  Government must pay fair value of property  Applies to businesses, too  Can only tax in ways Constitution allows  Congress can levy taxes  Direct taxes must be apportioned according to population  Guarantees the right to make binding contracts

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BELLRINGER  Brainstorm a list of tasks performed by librarians  Prepare to compare/contrast this job with the job of a government economist.

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TRACKING BUSINESS CYCLES MacroeconomicsMicroeconomics  Study of the behavior and decision making of entire economies  Study of the economic behavior and decision making of small units (individuals, families, households, business)

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ACTIVITY: KNOW THE DIFFERENCE! (COMPARE/CONTRAST) MacroeconomicsMicroeconomics  How the banking system operates throughout the U.S.  How an individual bank tries to make a profit by receiving deposits and making loans

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TRACKING BUSINESS CYCLES How is economic well- being measured? What’s a BUSINESS CYCLE?  Gross Domestic Product (GDP)  Total value of all final goods and services produced in an economy  Period of macroeconomic expansion followed by a period of contraction, or decline.

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PROMOTING ECONOMIC GROWTH StabilityEconomic Citizenship  Gives consumers, producers, and investors confidence in the economy  Indicator #1: price levels  Indicator #2: Health of financial institutions  Do you expect your generation to have a higher standard of living than that of past generations?  DO YOUR PART! GET AN UNDERSTANDING OF MACROECONOMIC PROCESSES THAT SHAPE OUR FUTURES!

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TECHNOLOGY AND PRODUCTIVITY Technological ProgressThe Government’s Role  Process used to produce a good or service  Improvements allow an economy to produce more output form same or smaller quantity of inputs, or resources  Morrill Acts of 1862 and 1890?  Land-grant schools (MIT, Texas A&M)?  NASA?  U.S. Patents?

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ACTIVITY... BACK TO BELLRINGER Compare and contrast the job of a librarian to the job of a government economist.

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MARKET FAILURES  Situation in which the market does not distribute resources efficiently

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EXTERNALITIES  An economic side effect of a good or service that generates benefits or costs to someone other than the person deciding how much to produce or consume.  Video: Externalities Video: Externalities